June 24, 2019

Blue States Still Pay Higher Property Taxes than Red Ones

Higher property taxes in blue states is the topic Charles Sells wants you to look at more closely this week.

By Charles Sells

This year, like every other year in recent history, states that tend to “vote blue,” which is to say, lean left, will charge their residents higher property taxes than states that tend to “vote red,” which is to say, lean right.

So, if you are a savvy investor who votes Republican, then you can chuckle to yourself as you head toward (you guessed it) a blue state like Illinois to do a little tax lien investing. Of course, plenty of Democrat and independent investors buy tax liens in Illinois as well, so maybe you should just set the politics aside for now (wouldn’t that be a relief?) and get back to investing in Illinois…

“What’s the deal with Illinois?” you ask. Well, that is a fine question.

Here are 3 things that make this state perfectly primed for smart tax lien investors:

1. More than 95 percent of tax liens in Illinois are redeemed

When a tax lien is redeemed, this means that the owner of the property pays the debt on their property and pays all fees, fines, and interest associated with your purchase of that tax lien certificate. Illinois just happens to have the highest property taxes in the country as of 2019 according to WalletHub.com, so clearly there are a lot of property owners who need a little extra time or a little extra “motivation” to pay up on those taxes. That is great news for the majority of tax lien investors, who do not want to foreclose on the property but do want to collect the interest on those liens.

2. You can earn 18 percent interest on the tax lien amount for each six months it remains unpaid

Illinois offers a great incentive to investors purchasing tax liens: 18 percent interest every six months. That converts to 36 percent annually. Given that Illinois requires a three-year “right of redemption,” meaning that the homeowner has the right to redeem their home for three years after you purchase the lien, that interest may really add up to incredible returns before the lien is purchased.

States with higher property taxes and Charles Sells advice on the Key to Success in Tax Lien Investing

3. Illinois makes it easy to find tax lien auctions

In some states, it can be quite an ordeal to locate tax lien auctions. In Illinois, however, they make it easy. Most counties publish their schedule and additional information online, in the paper, and in public tax offices. Some counties will even permit you to buy a list of every property up for auction and update that list regularly, and others update their lists online. In a state with high property taxes and high rates of property-tax defaults, the municipal governments have a vested interest in making sure you, the tax-lien investor, are easily able to find the information you need in advance.

Whether you are red, blue, purple, or some other partisan color completely, tax lien investing is one of the best ways to invest in real estate. However, knowing what states are the best for investing is no easy task. PIP Group has been investing in tax liens and tax deeds for more than a decade and has a knowledgeable team of tax lien experts to help you tailor your investments to your specific strategic goals. Go to PIPGroup.com to schedule a complimentary consultation today, and start investing in the best state for you.


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Understanding Winning Isn’t Everything is the Key to Success in Tax Lien Investing


About the author 

Charles Sells

Charles Sells is the founder and CEO of The PIP Group, a turnkey service provider that focuses on investments in distressed real estate assets including tax liens, tax deeds, traditional foreclosures, fix-and-flips and long-term cash flow acquisitions. He has been involved in tax lien investing for over 20 years, during which time The PIP Group has grown to become one of the largest agencies of its kind with nearly 1,000 individual and institutional investors worldwide.

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